During a recent congressional hearing, the Commerce Secretary emphasized that the American graphics‑chip maker must operate within a tightly defined framework when selling its most advanced AI processors to China. The discussion centered on the H200 chip, Nvidia’s second‑most powerful model, and the regulatory conditions attached to its export.
The Secretary explained that the licensing terms were crafted in close collaboration with the State Department. “These terms are very detailed and have been negotiated together with the State Department, and Nvidia must live with them,” he said. The agreement includes a range of safeguards intended to prevent the chips from falling into the hands of military users.
One key requirement is a “Know‑Your‑Customer” rule that obliges the buyer to confirm that the technology will not be used for defense purposes. Nvidia has yet to agree to this condition, which was highlighted in a report last week.
The decision to allow sales was made after a trade truce brokered by the U.S. and Chinese leaders during a summit in South Korea. The agreement temporarily postponed a U.S. rule that would have barred shipments of certain technologies to a broad list of Chinese companies.
When asked about the balance of power in the U.S.–China relationship, the Secretary again pointed to the president and the Secretary of State as the ultimate decision‑makers. “They help us and instruct us, and we follow their lead,” he said, noting that the complex geopolitical landscape is largely shaped by the highest political offices.
He also mentioned the broader context of critical minerals and rare‑earth elements, pointing out that the resolution of those issues rests with the president. The conversation underscored how intertwined technology exports, national security, and international diplomacy have become in the modern era.
